State to divert ‘fair share’ fees from unions

Published
12:00 am CDT, Thursday, March 19, 2015

SPRINGFIELD, Ill. — Illinois Gov. Bruce Rauner, dogged in attempts to eliminate fees paid to unions by workers who choose not to join, has instructed state agencies to divert money from nonunion employee paychecks away from organized labor until a judge settles the matter.

In a memo obtained by The Associated Press, general counsel Jason Barclay directs departments under the Republican governor’s control to create two sets of books: One with the “proper pay” and one, to be processed, that reduces the worker’s gross pay by an amount equal to what is normally paid in so-called “fair share” fees.

The idea was immediately condemned by the American Federation of State, County and Municipal Employees, the largest of two dozen unions that filed a countersuit over Rauner’s executive order.

“This legally questionable scheme shows the lengths to which Gov. Rauner will go in his obsession to undermine labor unions,” AFSCME executive director Roberta Lynch said in a prepared statement. “To frustrate lawful fair-share agreements, Rauner is ordering payroll staff to make unauthorized reductions in employees’ established salaries.”

Rauner signed an executive order last month eliminating the fees nonunion members pay, calling it a First Amendment violation. He’s seeking a federal court’s declaration that they are unconstitutional.

But the memo raised questions about how the deductions would affect federal tax withholding or health-insurance payments. Taxes are based on gross pay — if it’s lower, less is withheld, creating potential headaches down the line.

“We are confident in the process laid out in the memo,” Rauner spokeswoman Catherine Kelly said in a prepared statement. “It’s no surprise that AFSCME is doing everything in their power to deny state employees from exercising their First Amendment rights.”

Rauner, a businessman who admires Republican governors of Indiana, Wisconsin and elsewhere who have reduced the power of unions in those states, has also proposed “right-to-work” zones where local voters could decide whether workers should join unions.

The fair-share deductions would be held in agency operations budgets, not spent, Kelly said.

The memo said Republican Comptroller Leslie Munger “provided the method” for the plan, which a Munger spokesman said is not correct.

Lynch questioned what legal liability those payroll employees would face in issuing “inaccurate checks.” The system explained in the memo exposes a level of uncertainty associated with what labor expert Robert Bruno called “virgin territory.”

It recommends that each agency prepare a “payroll report using the normal figures,” copy and save it, and then create a second payroll “needed to reduce the gross pay” and enter a zero in a category reserved for fair share amounts. Then, it says, they “should be accepted by the comptroller.”

Comptroller Munger, whom Rauner appointed to fill a vacancy, had stymied the governor’s original plan to create a separate escrow account. Munger relied on the attorney general’s opinion it would be illegal. The memo’s credit to her for the latest plan is misdirected, Munger spokesman Rich Carter said.

The governor’s office “identified an alternative solution that does not require additional action from the comptroller,” Carter said.

About 6,500 nonunion workers pay amounts lower than union dues — about $575 annually — to cover the costs of union negotiating and grievances. Unions must represent those who chose not to join. Rauner’s action could keep about $3.74 million out of union bank accounts.

Bruno, a labor and industrial relations professor at the University of Illinois at Chicago, said Rauner’s move would likely prompt a new legal action by the unions. He said If Rauner is trying to demoralize labor, it hasn’t worked.

“In fact, a rather extraordinary form of unity and consensus has broken out,” Bruno said. “Labor can be a pretty rowdy internal institution because it has so many different elements.”